The business-as-usual energy scenario for the next 25 years — what the world will look like absent big changes in technology or policy — includes a nearly 50 percent increase in energy consumption with a steadily rising share of energy coming from renewables and natural gas, federal analysts say.
In its latest International Energy Outlook forecast, the U.S. Energy Information Administration sees fossil fuels continuing to dominate world energy demand through 2040.
Oil and other liquid fuels will remain the world’s top energy sources, though oil liquid fuels will fall from 33 percent of world energy consumption from the study’s 2012 baseline to 30 percent in 2040, the agency says.
Natural gas will continue on the breakaway path set by the unconventional energy boom as the fastest-growing fossil fuel, with consumption growing 1.9 percent per year for a 69 percent increase by 2040.
Meanwhile coal will be the slowest-growing energy source, increasing 0.6 percent a year worldwide but declining in China and the United States, the top two markets today. India, the next largest coal market, is expected to see demand increase.
EIA sees renewables growing the fastest over the next 25 years but from a relatively small base, increasing 2.6 percent per year worldwide and by 2040 claiming a roughly equal share of electric generation with natural gas and coal.
Overall, the analysis envisions world energy use climbing 48 percent over the 25-year projection period to go from 549 quadrillion British thermal units (Btu) in 2012 to 815 quadrillion Btu in 2040.
In a presentation of the new global energy analysis at the Center for Strategic and International Studies, EIA Administrator Adam Sieminski noted that a decoupling of GDP and energy use that appears in data from the past several years means that climate emissions are expected to grow at a slightly slower rate than energy use.
Overall, most of the growth in total energy use, electricity generation and the use of particular fuels is forecast to occur in developing nations, especially China and India, while Europe, the United States and other advanced economies are projected to see much slower growth driven by smaller, slower populations and GDP increases.
But Sieminski underlined the many unknowns that factor into the agency’s forecast, describing it as a baseline against which policy changes and unexpected developments could be judged, rather than a prediction of how world energy use would unfold.
The forecast includes current policies and rules as best ascertained by agency analysts, but better data are generally available in advanced economies than in poorer countries, and choosing what data to rely on can be subjective. Sieminski said the analysts’ use of 2012 as a baseline reflects a general lag in the availability of global energy statistics, but more recent data are incorporated into the modeling in some cases.
U.S. EPA’s Clean Power Plan, which is currently stayed by a Supreme Court order pending a multistate legal battle, is not charted into the agency’s forecast, Sieminski said, though a forthcoming elaboration of the world outlook will include it as a scenario.
The agency’s projections reflect major shale gas development in China over the coming years and steady growth in hydropower, wind and nuclear energy, but not the kind of dramatic technology advances that could change the calculus for any particular energy source.
Describing himself as a "technology optimist," Sieminski said he expects that technological developments and other spurs to economic growth will likely change the plotted trajectories for both energy use and national GDPs.
Negative events could shape the outlook too, he noted, pointing to the fragility of Venezuela’s economy and a world oil market that, while currently oversupplied, overall shows a lack of spare capacity that could spell trouble if major production volumes disappeared.
"Are we in a temporarily slow growth period?" Sieminski asked rhetorically. "I think some of this is a hangover from the 2008-2009 [economic] crash … but I don’t think we’re down for the count."
Click here for EIA’s International Energy Outlook 2016.